Significance Plants show remarkable regenerative abilities, allowing them to recover from wounds and organ loss. This regenerative capacity is controlled in part by auxin, the most promiscuous plant hormone controlling organogenesis and tissue patterning. We show that stem cell death diverges the auxin flow, much like rocks in a stream, resulting in an auxin accumulation in the tissues surrounding the wound. We demonstrate that within these tissues, wound-induced expression of the plant-specific transcription factor ERF115 works synergistically with the change in auxin accumulation, thereby specifying stem cell identity in the cells surrounding the damaged stem cells. This gain of stem cell identity drives formative divisions, allowing replacement of the lost stem cells and thus successful regeneration.